ED Coding and Reimbursement Alert

Question: I have several questions about observation services in the ED. Is it true that the observation time begins when the doctor admits the patient to observation? If the patient arrives in the ED on one calendar date and the doctor admits him to observation after midnight, how should we report this? In that case, must the chart include both an ED dictation and an H&P with admit orders for the obs stay - or does the initial dictation justify both charges?
   
Connecticut Subscriber

Answer: According to the CPT manual, observation services describe a calendar date of service and are not otherwise time-based. Medicare does require a minimum time threshold for billing observation or inpatient care services (including admission and discharge services), which you would describe with these three CPT codes:

99234 - Observation or inpatient hospital care, for the evaluation and management of a patient, including admission and discharge on the same date, which requires these three key components: a detailed or comprehensive history, a detailed or comprehensive examination, and medical decision making that is straightforward or of low complexity

99235 - ...a comprehensive history, a comprehensive examination, and medical decision making of moderate complexity

99236 - ...a comprehensive history, a comprehensive examination, and medical decision making of high complexity.

There is a minimum stay of eight hours for Medicare, and you should start the clock with the order to admit to observation. In a case where the same physician provides an emergency department (ED) evaluation and management (E/M) service on day one, and after midnight (now day two) admits that same patient to observation, the physician would need to perform a separate history and physical examination to qualify for billing the second E/M service.
 
To be paid for both services, you must provide the documentation for both.
 
Remember: Although you could reference the review of systems and past family social history (PFSH) from the earlier E/M service, the PFSH for observation codes require three of three elements from past, family, and social history - rather the two of three required for ED E/Ms.